Asian Shares Drift Lower Monday

7/16/2018 | 5:56 AM CDT

BANGKOK (AP) -- Shares were lower in Asia on Monday after China reported its economy grew at a lackluster 6.7 percent annual rate in the last quarter. Geopolitical and trade tensions were weighing on sentiment despite gains last week on Wall Street.

KEEPING SCORE: The Shanghai Composite index lost 0.7 percent to 2,811.01 and Hong Kong's Hang Seng edged 0.1 percent lower to 28,485.66. The Kospi in South Korea fell 0.4 percent to 2,301.99 and Australia's S&P ASX 200 gave up 0.4 percent to 6,241.50. Shares fell in Southeast Asia and Taiwan. Japan's market was closed for a holiday.

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WALL STREET LAST WEEK: Stocks wrapped up another solid week Friday as industrial and energy companies ticked higher. Corporate earnings from several major U.S. banks failed to excite investors, while consumer-focused companies like Amazon set record highs. The S&P 500 index edged up 0.1 percent to 2,801.31. The Dow Jones Industrial Average added 0.4 percent to 25,019.41. The Nasdaq composite set another record, just barely, as it ticked up 2.06 points to 7,825.98, and The Russell 2000 index of smaller-company stocks fell 0.2 percent to 1,687.08.

CHINA ECONOMY GROWS: China's economic growth slowed in the quarter ending in June, adding to challenges for Beijing amid a mounting tariff battle with Washington. The 6.7 percent pace of growth for the world's second-largest economy compared with 6.8 percent in the previous quarter. Even before the trade dispute with Washington erupted, forecasters expected growth to cool after Beijing started tightening controls on bank lending last year to rein in surging debt.

ANALYST'S VIEWPOINT: "The upshot is that the statistics bureau is now starting to more publicly acknowledge that the economy is losing steam. This should make it easier for officials to justify shifting to a more supportive policy stance," Julian Evans-Pritchard of Capital Economics said in a commentary. "The People's Bank has already been nudging down market interest rates since the beginning of the year but is likely to take the more high-profile step of cutting benchmark lending rates in the coming months."

EU-CHINA TRADE: European Council President Donald Tusk, while on a visit to Beijing, urged President Donald Trump, Russian President Vladimir Putin and China to work with Europe to avoid trade wars and prevent conflict and chaos. Tusk was speaking at the opening of a summit between China and the European Union, just hours ahead of a summit between Trump and Putin in Helsinki. Tusk said Europe, China, the U.S. and Russia had a "common duty" not to destroy the global order but to improve it by reforming international trade rules.

CURRENCY: The dollar fell to 112.36 yen from 112.39 yen late Friday while the euro rose to $1.1700 from $1.1688.

ENERGY: Benchmark U.S. crude rose fell 56 cents to $70.45 per barrel in electronic trading on the New York Mercantile Exchange. It rose 1 percent on Friday to $71.01 a barrel in New York. Brent crude, used to price international oils, lost 66 cents to $74.67 per barrel.

(BE)

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